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WITH tourism numbers surging, Phuket Airport is expecting a record four million passenger arrivals this year.

According to data released today in C9 Hotelworks’ Phuket Hotel Market Update, arrivals to Asia’s leading resort destination in the first half of the year increased 20% over the same period in 2010.

Numbers are straining the handling capacity of the airport with Airports of Thailand expecting 7.95 million passengers (including domestic passengers) this year, which will exceed the stated capacity by 22%.

A US$164 million expansion plan that will increase handling to 12.5 million by 2014 will only start construction next year and tourism operators are increasingly concerned over mounting delays for travellers.

The island's top five tourism source markets (in order) to date for 2011 are China, Russia, Australia, South Korea and Sweden.

A leading indicator in the cyclical development was shown in 2010 when charter flights hit their highest ever level. This equated to a 153% increase in year-on-year growth.

As guest demographics evolve, the Patong area which accounts for 35% of the 43,571 accommodation rooms on the island, produced an occupancy rate of 82% in H1 2011, with China and Russia now taking a quarter share of the market.

“First half trading by volume markets saw a surge in Phuket’s average occupancy across all hotel tiers to 73%. Key market metric RevPAR (revenue per available room) moved up to its highest level since the global financial crises in 2008,” C9 Hotelworks’ Managing Director Bill Barnett said.

“As long as the infrastructure keeps pace with the increased numbers of tourists and expansion of
hotels and faculties are well planned and implemented, hotels will be able to properly manage their room rates in line with the supply and demand dynamics.”

The report shows investment into Phuket’s hospitality sector has strong positive business sentiment with a supply pipeline for the island of 6,968 rooms. This will see an increase of 16% by the end of 2014.

Looking towards the future Mr Barnett added: “Increasingly the number of existing hotels will face the necessity to upgrade, rebrand or downgrade market position. While transaction activity is expected to remain active.

“In this business, either you move forward or go backward, there is no standing still.”